The ideals of peace and social inclusion have fallen prey to the capitalists and technocrats

Pang Li / China Daily

The existence of the euro is threatened by speculative attacks, mainly from Wall Street, while the US has refocused its international priorities on the Asia-Pacific region. We believe that instead of debating short-term technical solutions, European politicians should return to the political and democratic idea of European unity. Time is running out, as widespread social unrest and the rising anger of youth show. Who is ready to fight for European unity? Where does the EU now stand in Washington's political agenda? Has the Atlantic become a periphery of the Pacific Ocean?

If a specter is still haunting Europe, that specter is Europe itself - political Europe, to be precise. Throughout 2011 the European political project was hit by international financial speculation, based in Wall Street and, to a lesser extent, the City of London. Meanwhile, international politics has been remarkably absent. The US has focused all its efforts on the Asia-Pacific region and contributed to watering down the political meaning of the EU, potentially a dangerous competitor. Europe, on the other hand, has remained silent. European citizens are daily bombarded with news about interest rates, sovereign debt and other economic matters, millions of them having been plunged into unemployment, uncertainty, desperation, and outright poverty.

The European social fabric is disintegrating. Why then is nobody flagging the idea of a European democratic political union, once promoted by Altiero Spinelli and enlightened European statesmen and now seemingly neglected?

How can a politics of "technical" solutions help our ideals, values, and social welfare survive amid "global" competition?

In our view the European project is even more important, topical and beneficial than ever. We strongly reject the notion that European unity was just a technocratic enterprise aimed at countering the Soviet threat: Europeans should return to think about it as a way to peace and democracy.

Let's consider the international, economic, and social aspects of the current European crisis, and why a political Europe is once again relevant, in a new and different way.

For the first time in modern history, in a few years, perhaps as early as in 2016, the International Monetary Fund has forecast in the World Economic Outlook Database of April 2011, that a non-Western country may be the largest world economy. Being the biggest creditor of the US Treasury and endowed with the world's second largest military budget, the People's Republic of China constitutes an obvious concern for US interests. Together with China, the East Asia/Pacific area as a whole has become Washington's key focus.

Such strategic centrality has been made clear by the appointment to the Treasury of Timothy Geithner, an independent economist with life and study experience in China and Japan, and by key statements made by top US officers. In November, the US Secretary of State, Hillary Clinton, writing in the influential periodical Foreign Policy, talked of a "strategic turn to the Asia-Pacific region", and the National Security Adviser, Tom Donilon, during President Barack Obama's trip to Indonesia last year, talked of "the implementation of a substantial and important reorientation of American global strategy".

Words and diplomacy add up to recent and increasing US engagement in Australia, Myanmar, South Korea, and to the bare power of figures. According to the IMF, in 2010 Australia's and Singapore's per capita GDP far surpassed that of Britain, which once ruled them. South Korea's overall GDP may well overtake Italy's around 2015.

Where is Europe then? Clinton said in her Foreign Policy piece: "Europe is still a partner of first resort and we are investing in updating the structure of our alliance."

So Europe is worth an updating, nothing more.

For the US, a truly political Europe would be a strong competitor, and the euro a threat to the dollar's world hegemony. The shape of the current EU already reflects its subordination to Washington and Wall Street; with the financial crisis in 2008 its fragile structure has collapsed. Nor is the US ready or willing to help the EU.

We believe that, if anything, the US has chosen to let the euro sink and pre-empt any possibility of a real political union.

Further crisis would also offer US (and British) financial institutions the chance to later intervene and cheaply take over valuable European industrial and financial assets. In this sense, we can understand the attacks on the euro carried out by financial speculators, hedge funds, ratings agencies, and the related inaction of the US administration.

To sum up, Wall Street is waging a war of attrition on the euro, and the ideal of European integration itself. Meanwhile, the White House keeps silent, and focuses on Asia.

In fact since the early 1970s, especially in the US, Britain, and other English-speaking countries, capitalists have mainly invested in financial activities. Investment banks, pension funds, hedge funds, sovereign wealth funds, ratings agencies and the like have gradually entered a globalizing economic and political game.

No wonder then that the EU has taken shape as a "technical" form of "governance", despite the intentions of its founders; no wonder economic players such as investment banks or hedge funds (including much debated ratings agencies) have started speculating and attacking an EU they see as weak and basically unable to defend the single currency.

The key point is not that US or other agents are interested in making profits in Europe; after all, that is their job. The key point is that the EU does not have its own institutions, or a European rating agency, or other instruments such as the much-talked about euro bonds. We do not think such institutions would be enough. The EU cannot simply be a more-or-less efficient economic "machine"; it needs a truly political and democratic form, without which its legitimacy will always remain weak. Such weakness is already evident now, if we take a look at Europe's rising social problems and unrest, which represent a third phase of the crisis after the financial collapse and the economic downturn.

The youth are bearing the biggest burden. Youth unemployment rates have reached 45 percent in Spain, 43 percent in Greece and 33 percent in Lithuania, while NEET (not in education, employment, or training) youngsters are more and more common in Britain.

A Europe-wide recession this year would make the picture far bleaker. Among others, Italy's Prime Minister, Mario Monti, has praised the virtues of a "social market economy", and criticized both the US and the Chinese developmental models. Unfortunately, a "social market economy" seems to be fated to relegation to the history books. We believe that a divided, weak, "technocratic" EU will fall prey to either Chinese or US models, which, although respectable, are specific to other historical and cultural experiences.

Over the decades the EU's original spirit - peace, democracy and social inclusion - has been watered down, and it has turned into a mainly technocratic body. Indeed, most solutions we see in the current crisis debate are merely technical. Why is no political leader pondering the option of fighting for a political and democratic union? Has Europe become too old or self-complacent to envisage the possibility of a real and radical turn?

The issue at stake now is far from idealistic: with no political unity, a European model of peace and social welfare will hardly survive. More than others, we youngsters will probably carry the burden of the EU's decline and the inertia of its political classes. Who is ready to refresh the idea of European unity and fight for it?

Ernesto Gallo is an academic tutor of business, law and social sciences at Kaplan International College, London. Giovanni Biava is a corporate financial analyst at MP Consulting & Partners. The views do not necessarily reflect those of China Daily.